Financial trading blog
Thursday, July 21, 2016
Stock of the day 21/07/2016 – Twitter Inc
The company kicked off the New Year in the same way as it ended the old one: with a sharp decline. From an opening price of $22.40 Twitter had fallen all the way to an intraday low of $12.85 by the middle of February, an all-time nadir for the stock. A recovery in the latter half of February then saw the stock trading between $16 and $18 for March and most of April, before earnings-related woes left it hovering just above $14 for most of May. Since then Twitter has, like many US stocks, been on a near-uninterrupted rise, climbing back to a current trading price, and 4 and a half month high, of $18.60 (IT-Finance.com, 21/07/2016).
Unsurprisingly Twitter’s subdued stock price has been due to the persistently disappointing nature of its quarterly releases. While it beat Q4 expectations with earnings per share of 16 cents alongside $710 million in revenue back in February, news that monthly active users had fallen from 307 million to 305 million quarter-on-quarter helped send the stock to its aforementioned all-time low.
Things were hardly any better at the end of April, with its first quarter report causing a near 21% fall across 6 straight trading sessions as it beat EPS and monthly active user growth estimates but missed Q2 guidance projections. Twitter stated that it expects revenue between $590 million and $610 million in the second quarter, far lower than the $678 million forecast.
In terms of Twitter’s Q2 performance analysts are expecting the company to post revenue of $608 million, a 21% rise year-on-year alongside, more importantly, a 1% rise in monthly active users to 308 million (lower than the 310 million users seen in Q1).
Twitter Inc has a consensus rating of ‘Hold’ with an average target price of $20.68.Recent Posts:
Morning Market Comment 21/07/2016
Evening Market Comment 20/07/2016
Afternoon Market Comment 20/07/2016
Stock of the day 20/07/2016 - PayPal Holdings Inc
Morning Market Comment 20/07/2016
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